How To Refinance Your Home

With interest rates sitting just below 4 percent, now is a great time to crunch the numbers and see whether refinancing your mortgage can save you money.  As a general rule, homeowners will probably come out ahead when they can shave about 2 percentage points off of their interest rate.

If you have an adjustable-rate mortgage (ARM) or an interest-only loan, you might also benefit from refinancing, even if you don't save money on the monthly payments.  That's because you can lock in a 30-year fixed-rate mortgage at today's historically low rates and never have to worry again about your payments increasing.

Think you're a good candidate for refinancing?  Despite reports of banks hoarding money, lenders are still making loans.  But it has become harder to qualify for one.  Here's a road map to help you navigate the new and ever changing mortgage terrain.

"If you want access to the lowest interest rates, you need a credit score of 720 or higher."  If you have a score of 620 or below, you might not qualify for a loan at all.  Credit scores range from a low of 300 to a high of 850.

You'll need at least a 10 percent equity stake in your property to refinance.  And in some cases, you won't be able to get a loan without a 20 percent stake if private mortgage insurance is hard to get in your region. That might be a problem if you live in an in area where property values are quickly falling.  You might discover that your house is valued at less than you owe on your current mortgage, making refinancing difficult.  The one exception is for people with mortgages that are owned and held by Fannie Mae or Freddie Mac.  A new program will allow homeowners to refinance up to 105 percent of the home's value.

All homeowners will need to document their assets and income.  "Right now you have to prove you are the borrower you say you are, sometimes repeatedly."  Lenders want to make sure that homeowners can realistically afford any debt obligations, and they're reluctant to underwrite a mortgage if the homeowner's overall debt load is more than 43 percent of the family's income.  At the height of the housing boom, acceptable debt ratios reached as high as 55 percent.

Refinancing isn't an option for the millions of Americans who need to lower their monthly payments the most those who have lost their jobs.  Banks won't make new loans to such people until they can show pay stubs from a new job for at least 30 days.  A jobless homeowner's only option might be one of the new government programs for distressed folks, but they are usually available only to those who are at least 90 days delinquent on their payments.  And while it might be tempting to stop mailing in your check, know that your credit score will take a serious hit if you stop paying your mortgage.

In the past, you might have been able to refinance without paying any points and fees, but today that's often not the case.  Now that Wall Street is no longer securitizing smaller mortgages, the vast majority of conforming loans (those valued at $417,000 or less in most areas and $729,750 in high-cost areas) are sold to government-sponsored entities Fannie Mae and Freddie Mac.  About a year and a half ago, they started charging borrowers additional fees.  The first one you'll encounter is called an Adverse Market Delivery Charge, and it could add as much as a quarter of a percentage point to the loan.

Fannie Mae and Freddie Mac also charge a fee called the Loan Level Pricing Adjustment, which takes into consideration your credit score and loan-to-value ratio, or how much home equity you have.  Someone with poor credit and very little equity could end up paying an additional 300 basis points in fees.  So if you were borrowing $100,000 and had to pay 3.25 percentage points in fees, you'd owe the bank an additional $3,250 in closing costs.  If you wrapped the fees into the mortgage itself, you'd end up paying a 4.25 percent rate over the life of the loan.

Interest rates used to be fairly similar from one lender to another, but now they can vary by as much as a percentage point.  And some of the most competitive interest rates are found at the smaller community banks and credit unions, which might be better funded than some of the larger players that got caught in the sub-prime debacle.

Make sure you don't limit your shopping to a single bank or mortgage broker.  Some of the larger lenders, including Chase, no longer allow brokers to sell their products.  So if you want to see all of the rates in your area, you'll need to pick up the phone and do some calling around yourself.

You should visit Peak Home Loans.  They offer 2.625% home loan mortgage refinancing, home purchasing, home equity loans, debt consolidation loans and more. A $100K loan is only $402/mo. 4 in 5 will qualify.  Rates are at an all-time low, apply today!

Low Home Mortgage Refinance Rates

Home mortgage and refinance rates are very low right now because the FED continues to buy more and more MBS (Mortgage-Backed-Securities that directly move interest rates one way or another).  The past couple weeks have been relatively stable as far as market conditions go.  That means lenders can confidently continue to offer lower and lower interest rates.  This happens when Mortgage-Backed-Securities level-out.  In fact, this stability has led to rates remaining in the territory of new all-time lows.  There is a clear momentum behind these prices as well.  This puts the best-scenario, thirty-year fixed rate conventional loan at 3.25% for the majority of lenders and even 3.125% for some for the first time ever which is good for those intending to purchase a house or refinance a current loan.

But, not all is bright and shiny for the future.  The FED is artificially holding the prime rate, the rate at which lenders borrow money, at 0.0% (zero percent.)  And unfortunately, the FED is printing new money on a daily basis to pay mounting US debts.  This can lead to hyper-inflation.  This is the phenomenon where an individual will need a wheel barrow full of dollar bills to buy a loaf of bread.  So, as far a buying a new house at a cheap interest rate, things look good.  But, you might not be able to buy anything to put in the house.

You should visit Peak Home Loans.  They offer 2.625% home loan mortgage refinancing, home purchasing, home equity loans, debt consolidation loans and more.  A $100k loan is only $402/mo. 4 in 5 will qualify.  Rates are at an all-time low, apply today

Explain A Mortgage Refinance

Mortgage refinancing refers to the replacement of an existing debt obligation with a debt obligation under different terms.  The terms and conditions of home mortgage refinancing may vary widely by country, province, or state, based on several economic factors such as, inherent risk, projected risk, political stability of a nation, currency stability, banking regulations, borrower's credit worthiness, and credit rating of a nation. In many industrialized nations, a common form of refinancing is for a place of primary residency mortgage.  If the replacement of debt occurs under financial distress, refinancing might be referred to as debt restructuring.

 
A loan (debt) might be refinanced for various reasons:

1. To take advantage of a better interest rate (a reduced monthly payment or a reduced term)
2. To consolidate other debt(s) into one home loan (a potentially longer/shorter term contingent on interest rate differential and fees)
3. To reduce the monthly repayment amount (often for a longer term, contingent on refinance interest rate differential and fees)
4. To reduce or alter risk (e.g. switching from a variable-rate to a fixed-rate loan)
5. To free up cash (often for a longer term, contingent on interest rate differential and fees)

Refinancing for reasons 2, 3, and 5 are usually undertaken by borrowers who are in financial difficulty in order to reduce their monthly repayment obligations, with the penalty that they will take longer to pay off their debt.

In the context of personal (as opposed to corporate) finance, refinancing multiple debts makes management of the debt easier. If high-interest debt, such as credit card debt, is consolidated into the home mortgage, the borrower is able to pay off the remaining debt at mortgage rates over a longer period.

For home mortgages in the United States, there may be tax advantages available with refinancing, particularly if one does not pay Alternative Minimum Tax.

Most fixed-term loans have penalty clauses ("call provisions") that are triggered by an early repayment of the loan, in part or in full, as well as "closing" fees. There will also be transaction fees on the refinancing. These fees must be calculated before embarking on a loan refinancing, as they can wipe out any savings generated through refinancing. Penalty clauses are only applicable to loans paid off prior to maturity. If a loan is paid off upon maturity it is a new financing, not a refinancing, and all terms of the prior obligation terminate when the new financing funds to pay off the prior debt.

If the refinanced loan has lower monthly repayments or consolidates other debts for the same repayment, it will result in a larger total interest cost over the life of the loan, and will result in the borrower remaining in debt for many more years. Calculating the up-front, ongoing, and potentially variable costs of refinancing is an important part of the decision on whether or not to refinance.

In some jurisdictions, varying by American state, refinanced mortgage loans are considered recourse debt, meaning that the borrower is liable in case of default, while non-refinanced mortgages are non-recourse debt.

Points:
Refinancing lenders often require a percentage of the total loan amount as an upfront payment. Typically, this amount is expressed in "points" (or "premiums"). 1 point = 1% of the total loan amount. More points (i.e. a larger upfront payment) will usually result in a lower interest rate. Some lenders will offer to finance parts of the loan themselves, thus generating so-called "negative points" (i.e. discounts).

Closing Costs:
Borrowers with this type of refinancing typically pay few if any upfront fees to get the new mortgage loan. This type of refinance can be beneficial provided the prevailing market rate is lower than the borrower's existing rate by a formula determined by the lender offering the loan. Before you read any further do not provide any lender with a credit card number until they have provided you with a Good Faith Estimate verifying it is truly a 0 cost loan. The appraisal fee cannot be paid for by the lender or broker so this will always show up in the total settlement charges at the bottom of your GFE.

This can be an excellent choice in a declining market or if you are not sure you will hold the loan long enough to recoup the closing cost before you refinance or pay it off. For example, you plan on selling your home in three years, but it will take five years to recoup the closing cost. This could prevent you from considering a refinance, however if you take the zero closing cost option, you can lower your interest rate without taking any risk of losing money.

In this case the broker receives a credit or what's called yield spread premium (YSP). Yield spread premiums are the cash that a mortgage company receives for originating your loan. The broker provides the client and the documentation needed to process the loan and the lender pays them for providing this service in lieu of paying one of their own loan officers. Since a brokerage can have more than one loan officer originating loans, they can sometimes receive additional YSP for bringing in a volume amount of loans. This is normally based on funding more than 1 million in total loans per month. This can greatly benefit the borrower, especially since April 1, 2011. New laws have been implemented by the federal government mandating that all brokers have set pricing with the lenders they do business with. Brokers can receive so much YSP that they can provide you with a lower rate than if you went directly to the lender and they can pay for all your closing cost as opposed to the lender who would make you pay for all the third party fees on your own. You end up with a lower rate and lower fees. Since the new RESPA law as of April came into effect in 2011, brokers can no longer decide how much they want to make off of the loan. Instead they sign a contract in April stating that they will keep only a certain percentage of the YSP and the rest will go toward the borrowers closing cost.

True No Closing Cost mortgages are usually not the best options for people who know that they will keep that loan for the entire length of the term or at least enough time to recoup the closing cost. When the borrower pays out of pocket for their closing costs, they are at a higher risk of losing the money they invested. In most cases, the borrower is not able to negotiate the fees for the appraisal or escrow. Sometimes, when wrapping closing costs into a loan you can easily determine whether it makes sense to go with the lower rate with closing cost or the slightly higher rate for free. Some cases your payment will be the same, in that case you would want to choose the higher rate with no fees. If the payment for 4.5% with $2,500 in settlement charges is the same for 4.625% for free then you will pay the same amount of money over the length of the loan, however if you choose the loan with closing cost and you refinance before the end of your term you wasted money on the closing cost. Your loan amount will be 2,500 less at 4.625% and your payment is the same.

Cash-Out Refinancing:
This type of refinance may not help lower the monthly payment or shorten mortgage periods. It can be used for home improvement, credit cards, and other debt consolidation if the borrower qualifies with their current home equity; they can refinance with a loan amount larger than their current mortgage and keep the cash out.

Please visit Peak Home Loans.  They offer 2.625% home loan mortgage refinancing, home purchasing, home equity loans, debt consolidation loans and more. A $100K loan is only $402/mo. 4 in 5 will qualify.  Rates are at an all-time low, apply today!

Why Are Mortgage Interest Rates So Low?

In response to Market Watch's recent in-depth analysis of the U.S. mortgage refinance housing market, RoadFish.com's men's lifestyle and finance magazine encouraged readers considering a home refinance or a home purchase to take advantage of the nearly record-low mortgage interest rates, as they are predicted to eventually climb...

"So for folks who are considering mortgage refinancing a home or a new home purchase, my advice would be to take advantage of the current interest rates now because, who knows, it could be another 40 or 50 years until we see them this low again."

RoadFish.com men's lifestyle and mortgage refinance magazine today urged those of its readers who are toying with the idea of mortgage refinancing their home or home buying to consider acting fast, as a recent evaluation of the housing market revealed why mortgage interest rates are at a near all-time low and why they may be turning around soon. In fact they are so low that mortgage interest rates have even exceeded the expectations of professionals, begging the question of how mortgage interest rates are continuing to decline every week.

Amy Hoak of the Wall Street Journal's Market Watch reported that before the week of June 14th, rates on the average 30-year fixed rate mortgage broke record low levels for six straight weeks. During the week of June 14th the same interest rates averaged 3.71% as quoted by Freddie Mac. In her article, Hoak deftly addresses the curious situation of U.S. home mortgage interest rates continuing to decline even as statistics show that the housing market is making a comeback. Hoak points out that factors from abroad play a large role in influencing mortgage interest rates, and that there are additional issues within the U.S. federal government that citizens may not be aware of that are influencing the home loan market.

RoadFish.com urged its readers to heed the information in Hoak's article and act on it, if that is their intention. RoadFish.com's senior staff writer is quoted as saying, "This is a big deal. Home mortgage interest rates haven't been this low in over 40 years. I checked Freddie Mac's table of the monthly average rate for a 30-year fixed rate mortgage, which goes back to 1971, and it doesn't even begin to touch the rates we're seeing in 2012. So for folks who are considering mortgage refinancing a house or home purchasing, or for first time home buyers, my advice would be to take advantage of the current interest rates now because, who knows, it could be another 40 or 50 years until we see them this low again."  The above-mentioned Market Watch article reported that one of the biggest domestic factors in influencing interest rates is the U.S.

The Federal Reserve's Operation Twist Program, According to Freddie Mac's chief economist Frank Nothaft, says this program is based on the U.S. Federal Reserve purchasing long-term securities and selling so called "short-term" debt, which in turn keeps the interest rates low for the moment. The article also reports that the Eurozone crisis is currently playing a big role in the state of mortgage rates within the U.S. Concerns revolving around the continued integration of the euro zone is causing investors to transfer more money into places where they believe it will be protected. In so doing, this move affects yields on investments (such as 10-year Treasury notes) by decreasing them. Hoak reports that the mortgage market uses yields on the 10-year Treasury as their baseline when determining interest rates for 30-year fixed interest loans, so the yields on investments has a direct impact on affecting the mortgage rates.

RoadFish.com also encouraged readers to do their research and prepare for a large financial move such as refinancing or purchasing a home, and not simply to take advantage of the current rates if it is not within their means. RoadFish.com's senior staff writer is quoted saying, "The most important thing to remember with any major financial decision is to do your homework. Adopt a ‘home buyer beware' mentality, because then you will research high and low and get a solid amount of information before proceeding. Also, you need to do what's best for your own financial situation. Yes, the rates are incredibly low, but if purchasing a house this year is not within your budget then don't jump on it simply because it's a good deal. As I said, do your homework. Study your budget. Work on your credit report. Make sure your decisions make sense, and are not impulsive."

Hoak's article concludes by stating that these all-time-low mortgage interest rates are expected to eventually being climbing. The last time that mortgage interest rates bottomed out to as low as they are today, it was April 1956—fifty-six years ago.

Please visit Peak Home Loans.  They offer 2.625% home loan mortgage refinancing, home purchasing, home equity loans, debt consolidation loans and more. A $100K loan is only $402/mo. 4 in 5 will qualify.  Rates are at an all-time low, apply today!

Home Improvement Loans 203(k)

A home improvement loan is money lent to a property owner for home repairs, updates or remodeling.  Home improvement loans are not necessarily secured by the property they are intended for and may simply be classified as home improvement loans by the lender.  These loans can be secured or unsecured and are usually short term.

Home improvement loans are intended to increase the value of your home so it is important to think carefully about where best to put the money.  After all, the money spent on home improvements is added to your overall cost of the home and you want to be able to recoup this cost if and when you decide to sell.

Things to consider about home improvement loans:

1. Are you over-building for the neighborhood?  Adding a huge addition could make your house the nicest on the block but also the largest and most expensive, making it potentially harder to sell.
2. How much equity is available for home improvements and what is your maximum budget?  If you paid only $50,000 for your home ten years ago and now similar homes on your block are selling for $120,000, then you will have no problem investing in updates and repairs
3. Are you getting the most for your money?  Research has proven that upgrades to kitchens, baths and curb appeal offer an excellent return on your investment. Make sure you spend the money where it counts.

Ideas for home improvement loan project: The improvement possibilities for your home improvement loan are almost impossible to calculate.  While there are many decorating and design improvements possible, here are a few that are good to consider.

1. Additions - If you have a 2 bedroom, 2 bath house, consider adding a third bedroom. Similarly, if you have a 3 bedroom, 1 bath house, consider adding a second bathroom. And last but not lease, if you have a 2 bedroom, 1 bath house, consider adding a master suite complete with his and her closets and a full bathroom.
2. Updates - Concentrate on bathrooms and kitchens when spending the money from your home improvement loan. Kitchens and bathrooms seem to get outdated so quickly so it is important to use classic design concepts and soft, neutral colors. The lime green bathtub was a hit in 1975 but now desperately needs to be replaced.
3. Curb Appeal - Basic improvements such as landscaping or exterior painting can make a huge difference in the overall perception and value of your home. Keep these projects in mind when setting the budget for your home improvement loan project.

While the goal of your home improvement loan is to make repairs or upgrades to your home, the challenge is to make that money go even further, raising the value of your home above and beyond the level of money spent.

Funds for Handyman-Specials and Fixer-Uppers The purchase of a house that needs repair is often a catch-22 situation, because the bank won't lend the money to buy the house until the repairs are complete, and the repairs can't be done until the house has been purchased.  The problem is solved by HUD:

203(k) HUD Rehab Mortgage InsuranceSummary:
Section 203(k) insurance enables homebuyers and homeowners to finance both the purchase (or refinancing) of a house and the cost of its rehabilitation through a single mortgage or to finance the rehabilitation of their existing home.

Purpose: Section 203(k) fills a unique and important need for homebuyers. When buying a house that needs repair or modernization, homebuyers usually have to follow a complicated and costly process. The interim acquisition and improvement loans often have relatively high interest rates, short repayment terms and a balloon payment. However, Section 203(k) offers a solution that helps both borrowers and lenders, insuring a single, long term, fixed or adjustable rate loan that covers both the acquisition and rehabilitation of a property. Section 203(k) insured loans save borrowers time and money. They also protect the lender by allowing them to have the loan insured even before the condition and value of the property may offer adequate security.

For less extensive repairs/improvements, see Streamlined 203(k). For housing rehabilitation activities that do not also require buying or refinancing the property, borrowers may also consider HUD'sTitle I Home Improvement Loan program. Deceptive Home Improvement Contractors Complaints

HUD insures loans to help people renovate and repair their homes through programs called Title 1 and 203(k).  Some deceptive contractors in the program were performing shoddy work, falsifying documents, and overcharging homeowners. This fraud had victimized thousands of families and cost the taxpayers millions of dollars.

To avoid becoming a victim of fraud, work only with a HUD-approved Title 1 or 203(k) lender. This allows you to select the contractor and helps to prevent inflated estimates that only increase costs.

To report any fraud or abuse in the Title 1 or 203(k) Program, call toll-free (800) CALL-FHA or (800) 225-5342 or TTY (800) 877-8339.

Thank you,
Robert Pinzhoffer
Kindly visit Peak Home Loans, we can help with Home Mortgages

Reverse Mortgages

Frequently Asked Questions about Reverse Mortgages

The Home Equity Conversion Mortgage (HECM) is FHA's reverse mortgage program, which enables you to withdraw some of the equity in your home.  The HECM is a safe plan that can give older Americans greater financial security. Many seniors use it to supplement Social Security, meet unexpected medical expenses, make home improvements and more.  You can receive additional free information about reverse mortgages in general by contacting the National Council on Aging at (800) 510-0301 or downloading their free booklet, "Use Your Home to Stay at Home," a guide for older homeowners who need help now. It is smart to know more about reverse mortgages, and decide if one is right for you!

Select any 'Refinance' option for 'Loan Purpose' to apply for a Reverse Mortgage.

1. What is a reverse mortgage?

A reverse mortgage is a special type of home loan that lets you convert a portion of the equity in your home into cash. The equity that you built up over years of making mortgage payments can be paid to you.  However, unlike a traditional home equity loan or second mortgage, HECM borrowers do not have to repay the HECM loan until the borrowers no longer use the home as their principal residence or fail to meet the obligations of the mortgage.  You can also use a HECM to purchase a primary residence if you are able to use cash on hand to pay the difference between the HECM proceeds and the sales price plus closing costs for the property you are purchasing.

2. Can I qualify for FHA's HECM reverse mortgage?

To be eligible for a FHA HECM, the FHA requires that you be a homeowner 62 years of age or older, own your home outright, or have a low mortgage balance that can be paid off at closing with proceeds from the reverse loan, and you must live in the home. You are also required to receive consumer information free or at very low cost from a HECM counselor prior to obtaining the loan. You can find a HECM counselor online or by phoning (800) 569-4287.

3. Can I apply for a HECM even if I did not buy my present house with FHA mortgage insurance?

Yes.  You may apply for a HECM regardless of whether or not you purchased your home with an FHA-insured mortgage.

4. What types of homes are eligible?

To be eligible for the FHA HECM, your home must be a single family home or a 2-4 unit home with one unit occupied by the borrower. HUD-approved condominiums and manufactured homes that meet FHA requirements are also eligible.

5. What are the differences between a reverse mortgage and a home equity loan?

With a second mortgage, or a home equity line of credit, borrowers must have adequate   income to qualify for the loan, and they make monthly payments on the principal and interest.  A reverse mortgage is different, because it pays you – there are no monthly principal and interest payments.  With a reverse mortgage, you are required to pay real estate taxes, utilities, and hazard and flood insurance premiums.

6. Will we have an estate that we can leave to heirs?

When the home is sold or no longer used as a primary residence, the cash, interest, and other HECM finance charges must be repaid.  All proceeds beyond the amount owed belong to your spouse or estate.  This means any remaining equity can be transferred to heirs.  No debt is passed along to the estate or heirs.

7. How much money can I get from my home?

The amount you may borrower will depend on:

• Age of the youngest borrower
• Current interest rate
• Lesser of appraised value or the HECM FHA mortgage limit of $625,500 or the sales price; and
• Initial Mortgage Insurance Premium--your choices are HECM Standard or HECM SAVER

You can borrow more with the HECM Standard option. In addition, the more valuable your home is, the older you are, and the lower the interest rate, the more you can borrow.  If there is more than one borrower, the age of the youngest borrower is used to determine the amount you can borrow.  For an estimate of HECM cash benefits, select the online calculator from the HECM Home Page. Many online reverse mortgage calculators can provide you with an estimate of the amount of funds you can borrow.

8. Should I use an estate planning service to find a reverse mortgage lender?

FHA does NOT recommend using any service that charges a fee for referring a borrower to an FHA-approved lender.  You can locate a FHA-approved lender by searching online at http://www.hud.gov or by contacting a HECM counselor for a listing.   Services rendered by HECM counselors are free or at a low cost.  To locate a HECM counselor Search online or call (800) 569-4287 toll-free, for the name and location of a HUD-approved housing counseling agency near you.

9. How do I receive my payments?

You can select from five payment plans:

• Tenure- equal monthly payments as long as at least one borrower lives and continues to occupy the property as a principal residence.
• Term- equal monthly payments for a fixed period of months selected.
• Line of Credit- unscheduled payments or in installments, at times and in an amount of your choosing until the line of credit is exhausted.
• Modified Tenure- combination of line of credit and scheduled monthly payments for as long as you remain in the home.
• Modified Term- combination of line of credit plus monthly payments for a fixed period of months selected by the borrower.

10. What if I change my mind and no longer want the loan after I go to closing?  How do I do this?

By law, you have three calendar days to change your mind and cancel the loan.  This is called a three day right of rescission.  The process of canceling the loan should be explained at loan closing.  Be sure to ask the lender for instructions on this process.  Mortgage lenders differ in the process of canceling a loan.  You should ask for the names of the appropriate people, phone numbers, fax numbers, addresses, or written instructions on whatever process the company has in place.  In most cases, the right of rescission will not be applicable to HECM for purchase transactions.

Select any 'Refinance' option for 'Loan Purpose' to apply for a Reverse Mortgage.

Thank you,
Peak Home Loans

Frequent Questions From First-Time Home Buyers

1. Why should I purchase, instead of rent?
   • Answer: A house is an investment. When you lease, you write your monthly check and that cash is erased. But after you pay for your dwelling, you may remove the charge of your loan interest rate from your government income taxes, and usually out of your state taxes. This may save you a great deal each year, because the interest rate you pay is going to make up most of the monthly cost for most of the years of the morgage. You may also remove the property taxes you pay as a house owner. As well as, the worth of your residence might go up over the annum's. Finally, you'll take pleasure in having a thing that is all yours - a house where your personal style is going to inform the planet who you have been.
      
2. What are "Housing and urban Development Homes," and have been they an excellent deal?
   • Answer: Housing and Urban Development homes can be an excellent deal. When someone which has a HUD insured morgage cannot meet the funds, the lender forecloses on the home; HUD pays the lender what is owed; and Housing and Urban Development takes possession of your house. Then they promote it on market worth as speedily as possible. Read all about buying a Housing and Urban Development residence. Examine the listings of HUD homes and houses being bought by other federal agencies.
      
3. Can I develop into a home buyer even if I even have I've had below-average credit, and don't have much for a down-payment?
   • Answer: You may be a good candidate for one of the government mortgage programs. Start by getting ahold of one of the Housing and Urban Development-funded housing counseling businesses that can assist you sort through your options. Additionally, get a hold of your local authorities to see if there have been any local homebuying applications that might work for you. Look in the blue pages of your telephone listing in your local office of home and group development or, if you can not discover it, contact your mayor's workplace or your county govt's office.
      
4. Are there special homeownership grants or applications for single mom and dad?
   • Answer: There's help available. Begin by becoming acquainted with the home purchasing process and pick a superb actual property broker. Besides the fact that children as a single dad or mum, you won't have the advantage of two incomes on which to qualify for a mortgage, think about getting pre-qualified, so that after you discover a house you want within your price range you won't have the delay of trying to get qualified. get a hold of one of the Housing and urban development-funded housing counseling businesses within your area to speak through other choices for help that might be accessible to you. Research buying a Housing and urban development home, as they could be very good deals. Also, get a hold of your local government to see if there have been any local house purchasing applications that might help you. Look within the blue pages of the cellphone listing in your local office of housing and group improvement or, in case you can not find it, speak to your mayor's office or your county govt's office.
      
5. Ought to I take advantage of a real property broker? How do I discover a single?
   • Answer: Using a real estate broking service is an excellent idea. All of the details concerned in dwelling purchasing, especially the monetary ones, could be intellect-boggling. An excellent actual estate professional can aid you through the whole course of and make the expertise much easier. A true estate broking service will be well-acquainted with all of the significant stuff you'll desire to learn about a neighborhood you can be considering...the caliber of faculties, the number of youngsters in the environment, the safe practices of your neighborhood, traffic quantity, and more.
     
     
     She or he is going to help you determine the cost latitude you are able to come up with the money for and search the labeled advertisements and multiple itemizing expertise for buildings you will want to see. With immediate access to buildings as soon as they're put in the marketplace, the broker can save you hours of wasted driving-round time. When it's time to make an present on a home, the broking service can indicate ways to structure your deal to prevent money. She or he will explain the benefits and downsides of various kinds of mortgages, guide you via the paperwork, and be there to hold your hand and reply last-minute questions after you sign the final papers at closing. And you do not have to repay the broking service anything! The payment comes from the house seller - not from the buyer.
     
     
     By the way, if you want to buy a Housing and urban development house, you shall be required to make use of a real estate broking service to submit your bid. To find a broker who sells HUD homes, check your local yellow pages or the categorized part of your local newspaper.
      
6. How much money is going to I have to come up with to purchase a house?
   • Answer: Good, that depends on a few factors, including the cost of the house and the type of mortgage you get. In basic, you want to get a hold of enough money to cover three expenditures: earnest money - the deposit you make on the house when you submit your present, to show to the vendor that you are severe about wanting to purchase the house; the down cost, a percentage of the cost of your house that you must pay once you go to settlement; and closing expenditures, the costs linked to processing the paperwork to purchase a property.
     
     
     Once you make a suggestion on a house, your real property broking service is going to put your earnest cash into an escrow report. If the offer is accepted, your earnest money will be applied to the down cost or closing costs. If your offer is not accepted, your money will be returned to you. The quantity of your earnest money varies. If you purchase a Housing and Urban Development dwelling, for instance, your deposit usually is going to latitude from $five hundred - $2,000.
     
     
     The extra cash you can put into your down payment, the lower your morgage funds is going to be. Some types of loans require 10-20% of your purchase price. That's how come many first-time homebuyers flip to Housing and Urban Development's FHA for help. FHA loans require solely 3% down - and occasionally less.
     
     
     Closing expenditures - which you will pay at settlement - average three-4% of your cost of your home. These costs cover various charges your lender charges and other processing expenses. After you apply on your mortgage, your lender is going to give you an estimate of the closing expenditures, so that you gained be caught by surprise. If you buy a HUD dwelling, Housing and Urban Development may pay many of your closing costs.
      
7. How do I do know if I can get a mortgage?
   • Answer: Use our easy mortgage calculators to see how a lot morgage you may pay - that is a great start. If the quantity you have been able to afford is significantly lower than the charge of homes that interest rate you, then you could desire to attend awhile longer. However before you give up, how come do not you get in touch with a real estate broking service or a HUD-funded housing counseling agency? They will help you evaluate your mortgage potential. A broker know what sorts of loans the lenders have been providing and may assist you select a lender having a program that is likely to be right for you. Yet another good idea is to get pre-certified for a loan. That means you go to a lender and apply for a mortgage earlier than you actually start in search of a house. Then you definitely will know exactly how a lot you may meet the expense of to spend, and it'll speed the course of when you do discover the house of your dreams.
      
8. How do I find a lender?
   • Answer: You may finance a house with a mortgage from a bank, a savings and loan, a credit union, a personal mortgage company, or different state authorities lenders. Buying a loan is like buying every other large buy: you can save money if you take a while to look round for the best prices. Distinct lenders can offer quite different rates of interest and loan charges; and as you know, a lower interest rate can make a huge change in how much residence you have been able to pay for. Talk with a number of lenders before you decide. Most lenders need 3-6 weeks for the whole loan approval process. Your actual property broker will be aware of lenders within the area and what they're offering. Or you can look as part of your local newspaper's actual property part - most papers listing interest rates being provided by local lenders. You can find FHA-accredited lenders in the Yellow Pages of your phone book. Housing and Urban Development doesn't make loans directly - you ought to use a HUD-accredited lender in case you're fascinated by an FHA loan.
      
9. In addition to the mortgage cost, what different expenses do I need to think about?
   • Answer: Well, after all you'll have your monthly utilities. In case your utilities are coated as part of your rent, this may be new for you. Your actual estate broking service shall be capable of assist you get data from the seller on how a lot utilities normally cost. As well as, you may need homeowner association or rental association dues. You will certainly have property taxes, and you also could have city or county taxes. Taxes normally have been rolled into your morgage payment. Again, your broking service will be capable of help you anticipate these costs.
      
10. So what will my morgage cover?
    • Answer: Most mortgages have 4 components: principal: the reimbursement of your amount you in fact borrowed; interest rate: payment to the lender for the cash you have borrowed; householders insurance: a monthly amount to insure the property towards loss from fire, smoke, theft, and different hazards required by most lenders; and property taxes: the annual city/county taxes assessed in your property, divided by the variety of mortgage funds you make in a year. Most loans are for 30 years, however fifteen yr. loans are available, too. During the lifetime of the loan, you will pay far more in interest rate than you'll in principal - sometimes two or three times more! Because of the means loans are structured, within the first years you will be paying generally interest rate in your monthly payments. Within the last years, you is going to be paying largely principal.
       
11. What do I need to take with me once I apply for a mortgage?
    • Answer: Good question! If you have everything with you when you visit your lender, you will save a good deal of time. You should have: a single) social safety numbers for both your and your partner, if both of you are making use of for the mortgage; 2) copies of your checking and savings statement statements for the past 6 months; 3) facts of any other belongings like bonds or stocks; four) a current paycheck stub detailing your earnings; 5) a listing of all credit card accounts along with the approximate monthly quantities owed on every; 6) a list of statement numbers and balances due on excellent mortgages, resembling car mortgages; 7) copies of your last two annums' earnings tax statements; and 8) the name and tackle of someone who can verify your employment. Depending on your lender, you can be requested for other information.
       
12. I do know there have been plenty of varieties of mortgages - how do I do know which 1 is finest for me?
    • Answer: You're correct - there are many varieties of loans, and also the more you know about them before you start, the better. Plenty of people use a constant-fee morgage. In a hard and fast charge morgage, your interest rate stays the same for the time period of your morgage, which usually is thirty years. The benefit of a fixed-charge mortgage is that you simply at all times know exactly how a lot your mortgage cost will be, and you can plan for it. An additional reasonably morgage is an Adjustable Price Mortgage (ARM). With this reasonably mortgage, your interest rate and month-to-month payments usually begin lower than a fixed charge morgage. However your fee and cost can change both up or down, as frequently as a few times a year. The adjustment is tied to a economic index, such because the U.S. Treasury Securities index. The benefit of an ARM is that you simply may be able to find the money for a more costly house as a result of your initial interest rate will be lower. There are a number of authorities mortgage applications, together with the Veteran's Administration's applications and also the Branch of Agriculture's programs. Plenty of people have heard of FHA mortgages. FHA would not in fact make mortgages. Instead, it insures mortgages in order that if consumers default for some cause, the lenders is going to get their money. This encourages lenders to offer mortgages to people who will possibly not otherwise qualify for a loan. Refer to your real property broking service concerning the different sorts of loans, earlier than you begin buying a morgage.
       
13. After I discover the house I want, how much ought to I present?
    • Answer: Once again, your real estate broking service may help you here. However there are a number of stuff you should think about: one) is the asking price in line with prices of similar buildings in the area? two) Is the house in good situation or will you need to spend a substantial amount of money making it the way in which you desire it? You most likely want to get an expert dwelling inspection earlier than you make your offer. Your actual estate broking service may help you organize one. 3) How long has the residence been in the marketplace? If it's been for sale for awhile, the seller may be extra wanting to accept a lower offer. four) How much mortgage will be required? Ensure you actually can come up with the money for anything give you make. 5) How much would you really want the residence? The nearer you are to the asking cost, the more seemingly your present is going to be accepted. In some cases, you might even want to offer greater than the asking price, in case you will know you're competing with others for the residence.
       
14. What if my offer is rejected?
    • Answer: They often are! However don't let that stop you. Now you start negotiating. Your broking service will support you. You might need to offer more money, but you may talk to the vendor to cover some or all of your closing expenditures or to make repairs that wouldn't normally be expected. Frequently, negotiations on a price go backward and forward several instances before a deal is made. Simply remember - don't get so caught up in negotiations that you simply lose sight of what you actually need and might come up with the money for!
       
15. So what will happen at closing?
    • Answer: Essentially, you will sit at a table with your broker, the broking service for the seller, probably the vendor, and a closing agent. The closing agent may have a stack of papers for yourself and also the seller to sign. Whereas he or she will give you a primary clarification of each paper, you should want to take the time to read each and/or seek advice from your agent to ensure you will know precisely what you're signing. In spite of everything, this is a considerable amount of money you are committing to pay for for a lot of years! Before you go to closing, your lender is required to offer you a booklet explaining the closing costs, a "good faith estimate" of how much money you'll ought to provide at closing, and an inventory of documents you'll want at closing. If you don't get these gadgets, be sure to call your lender BEFORE you go to closing. Be sure to study the booklet on settlement costs. It will help you comprehend your rights within the process. Don't hesitate to talk about questions.

If you are a First Time Home Buyer, please visit Peak Home Loans.

Everything You Wanted To Know About Bankruptcy

 What Is Bankruptcy?
Bankruptcy is a legal proceeding in which a person who cannot pay his or her bills can get a fresh financial start. Filing bankruptcy immediately stops all of your creditors from seeking to collect debts from you, at least until your debts are sorted out according to the law. A decision to file for bankruptcy should be made only after determining that bankruptcy is the best way to deal with your financial problems. Bankruptcy is a difficult and personal decision, but it is a choice that may help if you are facing serious financial problems.

Although bankruptcy can help with some financial problems, its effects are not permanent. If you choose bankruptcy, you should take advantage of the fresh start it offers and then make careful decisions about future borrowing and credit, so you won't ever need to file for bankruptcy again!

What Can Bankruptcy Do for Me?
Bankruptcy may make it possible for you to:
1. Eliminate the legal obligation to pay most or all of your debts. This is called a "discharge" of debts. It is designed to give you a fresh financial start.
2. Stop foreclosure on your house or mobile home and allow you an opportunity to catch up on missed payments. (Bankruptcy does not, however, automatically eliminate mortgages and other liens on your property without payment.)
3. Prevent repossession of a car or other property, or force the creditor to return property even after it has been repossessed.
4. Stop wage garnishment, debt collection harassment, and similar creditor actions to collect a debt.
5. Restore or prevent termination of utility service.
6. Allow you to challenge the claims of creditors who have committed fraud or who are otherwise trying to collect more than you really owe.

What Can't Bankruptcy Do for Me?
Bankruptcy cannot, however, cure every financial problem. Nor is it the right step for every individual. In bankruptcy, it is usually not possible to:
1. Eliminate certain rights of "secured" creditors. A "secured" creditor has taken a mortgage or other lien on property as collateral for the loan. Common examples are car loans and home mortgages. You can force secured creditors to take payments over time in the bankruptcy process and bankruptcy can eliminate your obligation to pay any additional money if your property is taken. Nevertheless, you generally cannot keep the collateral unless you continue to pay the debt.
2. Discharge types of debts singled out by the bankruptcy law for special treatment, such as child support, alimony, certain other debts related to divorce, most student loans, court restitution orders, criminal fines, and some taxes.
3. Protect cosigners on your debts. When a relative or friend has co-signed a loan, and the consumer discharges the loan in bankruptcy, the cosigner may still have to repay all or part of the loan.
4. Discharge debts that arise after bankruptcy has been filed. How can you save your assets? Bankruptcy is a federal legal process for debt management available to most individuals and businesses. Successfully completing a bankruptcy case allows individuals and businesses to either eliminate or reorganize most of their debt. The bankruptcy laws are contained in 11 U.S.C. Sec. 101 et seq.-

When should I consider bankruptcy?
You should consider bankruptcy when:
1. you've been unemployed for several months and your prospects are questionable.
2. it becomes evident you cannot pay your bills as they come due.
3. you start considering using your VISA card to pay your MasterCard.
4. you receive a letter from your mortgage company threatening foreclosure.
5. you fear your car will be repossessed.
6. your car HAS been repossessed.
7. you're considering a home equity loan to consolidate your bills.
8. you're considering cashing in your 401(k) or your IRA.
9. you're worried about protecting other assets.
10. a creditor is threatening or has filed suit.
11. you have significant IRS debt.
12. you just can't abide any more collection letters and phone calls.

Are there alternatives to bankruptcy?
Of course. Some people have successfully managed their finances through nonprofit credit counseling centers. Sometimes a payment plan can be negotiated directly with a creditor. Obtaining loan extensions, compromises and workout agreements require negotiation skills and experience. These alternatives may alert your creditors to the existence of nonexempt property that the creditor could reach and can involve considerable expenses. You also have the option of doing nothing, which may entail certain risks. Creditors can obtain court judgments on the debt and then attempt to collect the judgment. Some states allow creditors to satisfy their judgments out of the debtor's property, including bank accounts and certain personal property. If you sell real property after the judgment is filed, you will most likely have to satisfy the judgment out of the proceeds of the sale. Judgment creditors cannot, however, foreclose on your homestead to satisfy the judgment, and they cannot garnish your wages.

What kinds of bankruptcy are available? 
There are five kinds of bankruptcy:
Chapter 7 - also known as "straight" bankruptcy.
Chapter 9 - reorganization for municipal entities.
Chapter 11 - reorganization for businesses and for individuals with excessive debt. 
Chapter 12 - reorganization for family farmers.
Chapter 13 - reorganization for individuals with a regular source of income Most individuals and couples file either a Chapter 7 case or a Chapter 13 case.

Do I need an attorney to file bankruptcy?
No, but the process can be intimidating, and complications can cause dire results. Try to use an attorney if possible.

What is a Chapter 7 bankruptcy?
The bankruptcy laws are designed so that all debtors emerge from bankruptcy with sufficient assets to make a fresh start. These assets are called exempt property. Chapter 7, also known as "straight" bankruptcy, requires that you turn over all nonexempt property to a bankruptcy trustee, who then converts it to cash for distribution to your creditors.

What is a Chapter 13 bankruptcy?
When you file a Chapter 13 case, you agree to pay over to the Chapter 13 trustee a portion of your disposable income each month for 3 to 5 years.

Will the bankruptcy stop bill collectors from calling?
Yes. A provision of the Bankruptcy Code stops these calls.

Will bankruptcy stop a wage attachment?
Yes, including IRS wage attachments.

Will bankruptcy stop a foreclosure?
Temporarily, yes. But, not forever.

Will bankruptcy stop a lawsuit?
Bankruptcy stops most civil lawsuits, including most IRS proceedings.

Is it true I can cancel all debts by filing bankruptcy?
The underlying policy of bankruptcy law is that the honest debtor who is in debt beyond her ability to repay the debt should receive a fresh start through the discharge of debts.

Is alimony dischargeable?
Alimony, maintenance and child support payments generally are not dischargeable.

Will bankruptcy remove a lien?
Under some circumstances, once the bankrutcy proceedings have started, a special motion can be filed to remove certain liens. 

Can I discharge student loans?
Generally, student loans are not discharged in bankruptcy. 

Can I discharge taxes?
In most instances, taxes owed to the federal government are not discharged unless they are more than 3 years old. 

Will bankruptcy affect my job?
Your employer cannot fire you for filing bankruptcy.

What happens to my personal property, real property and other assets?
You are required to file a schedule with the court describing all of your assets. Certain property is either excluded from the bankruptcy or exempt, and you will be able to keep that property.

Will I have to go to court?
About 4 to 6 weeks after filing the bankruptcy petition, you will have to attend a hearing presided over by a bankruptcy trustee.

What if someone who owes me money files bankruptcy?
If you are listed as a creditor in the case, you will receive notice of the bankruptcy from the court in which the case was filed.

My employer filed bankruptcy. How do I get paid?
If you are a union employee, contact your union. If not, file a proof of claim for any unpaid wages, vacation benefits, etc. owed from before the date of filing.

What should I do to prepare for filing bankruptcy?
First, you should consult with an attorney. An attorney can help you plan for the bankruptcy, decide when to file a bankruptcy petition, or even avoid filing for bankruptcy. If you decide to file a bankruptcy petition, you should:
1. Stop using your credit cards. If you charge up your credit cards knowing that you're going to file bankruptcy, the debt may not be discharged. Also luxury purchases over $1,150 and cash advances totaling more than $1,150 within 60 days before the bankruptcy filing are not dischargeable.
2. Don't transfer your assets to friends, family and business associates to protect the assets from your creditors. The transfer may be considered a fraudulent conveyance. If it is, you may lose both the property and your right to a bankruptcy discharge. Instead, consult an attorney. There may be legitimate ways to save the property.
3. Don't destroy any business or financial records. You can lose your right to a bankruptcy discharge as a result.
4. Carefully choose the creditors you pay. Some creditors, such as landlords, secured creditors, and some utilities should be paid under most circumstances. If you pay a credit card debt that eventually will be discharged, you may be throwing money away.

Thank you,
Robert Pinzhoffer 
Kindly visit Peak Home Loans, we can help with Home Mortgages!

If you need legal counsel regarding bankruptcy, you should contact a bankruptcy attorney in Richmond, VA today.

All About Foreclosure

As you know, if you don't pay your monthly mortgage payments over a period of time, the mortgage company can foreclose. This means you will lose title to your property and may be evicted from your home. A foreclosure becomes part of your credit report and may adversely affect your ability to obtain credit in the future. To avoid possible foreclosure, it is helpful to have money saved to cover several months of your housing costs in case of an unexpected emergency, like job loss, divorce or separation, serious illness, or the death of a loved one.

What if You Cannot Pay Your Mortgage?

1.  Apply with us today!  Click Here Now.  A representative will contact you shortly thereafter.

2. Contact an attorney.  We cannot stress this enough.

3. You have likely called your mortgage company and they refuse to help you.
This is standard.  But again, do not despair.

Too many people in financial trouble wait until the last minute.  Some hope their problems will quickly resolve themselves. Others worry the mortgage company will rush to collection or foreclosure. In a significant number of all foreclosures, the borrowers did not return their mortgage company's calls or written invitations to discuss payment options.  The truth is: the longer you wait, the greater your chance of losing your home. If you are unable to make your mortgage payment, use the form above. Depending upon your situation, here are a number of alternatives that professionals will discuss with you.  Here's things you should know:

1. Forbearance is an agreement to temporarily let you pay less than the full amount of your mortgage payment, or pay nothing at all, during the forbearance period. Mortgage companies may consider forbearance when you can show that funds from a bonus, tax refund, or other source will let you bring the mortgage current at a specific time in the future.
2. A Reinstatement occurs when you pay your mortgage company the total amount you are behind, in a lump sum, by a specific date. This is often combined with forbearance.
3. A Repayment Plan is an agreement that gives you a fixed amount of time to repay the amount you are behind by combining a portion of what is past due with your regular monthly payment. At the end of the repayment period you have gradually paid back the amount of your mortgage that was delinquent.
4. A Loan Modification is a written agreement between you and your mortgage company that permanently changes one or more of the original terms of your note to make the payments more affordable. Common loan modifications include:
   • Adding missed payments to the existing loan balance (get current with your payments)
   • Making an adjustable-rate mortgage into a fixed-rate mortgage (turn your high ARM into a low fixed rate mortgage)
   • Extending the number of years you have to repay (to lessen your monthly payments forever.

Good luck...
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Home Equity Loans

Most common uses of Home Equity Loans:

1. Home improvement
2. Debt consolidation for homeowner's
3. Pay for college
4. Add an addition to your home
5. Pay off credit card bills
6. And many other uses along these lines

A home equity loan and home equity lines of credit are two of the best ways of making your home work for you.  For homeowners who are interested in receiving a lump sum payment a home equity loan may be the best way to use your home equity to your advantage.  If as a homeowner you’re running into large costs like post secondary tuition, medical expenses or starting a small business a home equity line of credit may also work to your advantage.  In some situations, a home equity loan or a home equity line of credit makes more sense than refinancing.  If you’re a homeowner who has built up equity with a substantial down payment, has paid down a large part of your mortgage principal and/or has seen an increase in property values you can reap the benefits of a home equity loan by borrowing against the equity you have in your home.

As a rule, a home equity loan is based on a given percentage of your home’s appraised value, minus any outstanding balance. For instance, if your home is appraised at $200,000 then 80 percent of that total would be $160,000.  If your remaining unpaid mortgage amount is $130,000, then you would have $30,000 in available equity.   It may also be important for you to realize that some lenders now offer a home equity line of credit up to 125% for well qualified consumers.  Your ability to repay the home equity line of credit is also taken into account when you apply.

As with any mortgage loan, your home equity loan rate will vary with your own unique personal credit history, outstanding debts and income.  Your home equity loan rate is usually variable and one to three points above prime.  You also benefit from interest rates being tax-deductible as your house is used as collateral for your home equity loan.  Your home equity loan options include traditional fixed rate and variable rate loans.

A home equity loan is similar to a second mortgage in that payments are often made monthly over a 10 to 30 year term and result in full repayment. With a variable rate home equity loan, you should understand what your minimum monthly payments and maximum interest will be for your personal equity amount.  Note also that fees usually apply on all home equity loans. Additional expenses often include points, application costs, appraisal fees and the cost of having a credit check done.  If however, you opt to pay more points up front to borrow at a 100 percent loan to value (LTV) ratio, many if not all of these charges may be waived.

Home Equity Loans - Equity seconds - Equity seconds are second mortgages that use the equity you have in your house as the basis upon which a lender loans you money.  These loans include home equity loans and home equity lines of credit, or HELOC 's.  Most lenders will require an appraisal in order to establish your house's value and the equity contained therein. Borrowing with an equity second normally allows you to obtain a better rate due to the fact that the money borrower is secured on property you have ownership in.

Home Equity Loans - Over-equity seconds - Over-equity seconds are second mortgages that lend you money over and above the value of your house. Over-equity seconds are commonly known as "125's" or "115's" because they allow a lender to loan you money at 125% or 115% of your house's value. Requirement of appraisal is based upon the amount of money borrowed. Typically, if you plan to borrow over $35,000 on an over-equity loan, an appraisal is required. Borrowing with an over-equity second allows you to obtain a loan when a personal loan may have not been possible.  WE CAN LEND UP TO 95% OF YOUR HOME'S EQUITY.

Home Equity Line Of Credit (HELOC) -   A home equity line of credit is often more flexible than a standard lump-sum home equity loan since it carries a shorter term.  For homeowners who occasionally need some extra cash, a home equity line of credit may be just the product to protect you against overdraft fees on your checking account.

A home equity line of credit gives you a specific credit limit based on a percentage of your home’s appraised value less your remaining mortgage balance.  A benefit of the credit line option is that you only have to pay interest on the amount you use.  No interest is charged on unused portions and if you decide not to use it, it costs you nothing.  A home equity line of credit agreement is usually divided into what is known as a draw period and a repayment period.  The draw period usually runs five to ten years during which you can take out any portion of the funds you desire simply by writing a check against the line of credit.

Any payments then go back onto your credit line and become available funds.  Sometimes homeowners opt to make interest only payments until the home equity line of credit comes due.  At the end of the draw period you may opt to renew your home equity line of credit or pay off the outstanding balance. Whether you will be able to renew your line of credit or not is at the discretion of your lender.  Please note as well that some line of credits have minimum withdrawal amounts and or monthly payments guidelines you must adhere to. Any limitation should be spelled out in your agreement.

Debt Consolidation Loans for homeowner's are not the same as debt consolidation loans for non-homeowner's.  Debt consolidation loans for homeowner's are loans that are backed by the equity the homeowner has in their home.  Debt consolidation loans for homeowner's are secured loans.  We offer both debt consolidation for homeowners and non-homeowners.  Debt consolidation loans for homeowner's are very similar with second mortgages, home equity loans and HELOC's.  They can usually be used interchangeably.

Home Improvement Loans can be either a home equity second mortgage or over-equity second mortgage can be used for home improvement purposes ranging from minor repair to major refurbishing to new home additions.  In the case of an over-equity second being used for home improvement, a lender will normally require an estimate of work to be completed on the home for amounts above $10,000.  Some lenders may also require that the money borrowed be directly paid to the contractor performing the work.  Either way, if you want to spruce up your home, add an addition, have landscaping done, or whatever, please fill out our no-obligation form and an experienced home mortgage specialist will contact you within 24 hours and get you the loan you need.

Kindly visit Peak Home Loans we can help with Home Mortgages!

Top 5 Mistakes People Make When Taking Out a Home Equity Loan

1. Choosing a home equity lender for the wrong reason (i.e., the lowest rate, your existing lender.)

People choose home equity lenders for all the wrong reasons. Getting a low rate is important, but it's not the only consideration when you want to take out a home equity loan. Lenders may offer the lowest rate but charge extra fees (loan fees, origination fees, copy fees) so that in the end you'll pay more for the home equity loan even though your rate may be lower. The only way to protect yourself is to wait for the Good-Faith Estimate (GFE) which should list all the closing costs. Compare the GFE's from a number of home equity lenders.

But comparing GFE's is not the only story when you want to take out a home equity loan. If time is important, you want to choose a mortgage company that is capable of acting quickly. Ask each company to give you their average closing time for loans similar to yours.

Ask around among your trusted friends. Find out who took out a home equity loan lately and ask them what they thought of the company. Don't assume that your existing lender is any better than a new lender. Since most loans are sold in the secondary market, everyone has to meet certain criteria, and your existing lender will probably require the same documentation as a new lender. However, once you have a commitment from a new lender, it doesn't hurt to ask your existing lender to beat it. Often times they will. We will get you the best rate available.

2. Not getting everything in writing when seeking a home equity loan.

Get everything in writing. No matter what the Loan Officer tells you about your home equity loan, ask him/her to confirm it in writing. Don't believe someone when they tell you that your home equity rate is guaranteed. Get it in writing.

3. Not knowing the difference between a home equity loan and a home equity line of credit.

A home equity loan is a loan, like a 2^nd mortgage. A home equity line of credit is a credit line - money that is made available to you to use when you need it. There's a big difference. Some credit lines have interest rates which are adjustable and which can go as high as 15% or more.

4. Not knowing the appraised value of your home.

Home equity loans and home equity lines of credit are based on the difference between what you owe on your house and what your house is worth. Many people go ahead and try to get a home equity loan on their home without knowing the true value. There are many places you can get an estimate of the true value of your home. Many realtor sites have home value estimators on their site. For the price of listening to a mortgage company try to sell you a mortgage, you can get an approximate value for your home.

Check the recent sales in your neighborhood and try to find a comparable house in a comparable location. Or you can ask the appraiser to do a drive by and give you a verbal estimate of the value of your home. If it's in the right ballpark, you can order a thorough appraisal.

5. Not doing the math on a home equity loan.

Having a home equity loan can be better than taking out a 2^nd mortgage because the origination costs are less. However, the monthly interest rate may be more with a home equity loan than with a 2^nd mortgage. So, depending on how much you are going to need and how soon you are going to need it, you may find that a 2^nd mortgage is a better way to go.

One of the biggest mistakes people make with home equity loans is to take out a large amount of money and put it into their checking account. You may pay as much as 8% for the home equity loan while the money you took out is only earning 2% in your bank account. Recommendation - only take out as much as you are planning to use.

Kindly visit Peak Home Loans we can help with Home Loans!